Equity method entries. Hanna Company purchased 100% of the common stock of Denver Company on January 2

Question:

Equity method entries. Hanna Company purchased 100% of the common stock of Denver Company on January 2 for $550,000. The common stock of Denver Company at this date was $200,000, and the retained earnings balance was $350,000. During the year, net income of Denver Company was $120,000 and dividends declared were $30,000. Hanna Company uses the equity method to account for the investment. Give the journal entries that Hanna Company made during the year to account for its investment in Denver Company.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...